The Struggles Of Coworking In Mexico: “We Get Compared To Regus A Lot”

Published on July 13, 2017 - By Cecilia Amador

Opened a mere three months ago,  Work Inc Mexico is making quite an impact in the local market.

Speaking with Alan Arriaga, CEO at Work Inc Mexico, we learned that although the doors officially opened in April this year, Work Inc has been long ‘in the works’.

“The project really started three years ago, when I first met up with investors to plan and brainstorm ideas on how to go about opening a coworking space in Mexico. Back then here in Mexico, the whole concept of coworking was unfamiliar to most, and pitching the idea to investors in a manner that was appealing was no easy task.”

The effort paid off, although it took time, and Work Inc was finally able to open this year with the support of 3 Mexican investors.

And although Alan believed they were headed in the right path, after attending GCUC this year in New York, he began to have doubts. Mainly the doubts were about the square footage and whether they had been too eager on that end.

“I heard about GCUC and figured it was the perfect opportunity to immerse myself some more on the industry and learn about global trends. As I spoke with some other attendees and told them about Work Inc, they all seemed to have the same feedback: ‘you went in with way too much square feet on your first location.’ This was something I hadn’t thought of before, and I understood why they felt that way. We have an entire 5 floor building in the heart of Mexico City, in Rio Lerma.”

The entire 5 floors are not all limited to coworking, however, and Alan believes this will help lessen some of the burden and stress of ‘filling up space’.

“The first floor is for commercial use, we have several restaurants and coffeeshops operating there. The second floor is being leased out entirely by a film company. We’ve had TV shows, movies, and commercials partly shot on our premises. The third floor is where our ‘formal lobby’ is located. This floor is made up of private offices, a meeting room, and a common area; this is the floor that is already at 85% capacity. The fourth floor is our purely coworking and open spaces, and the fifth floor is our most exclusive floor with private offices that have private balconies as well.”

Alan further explains that making the decision of adding common areas to the private office floors was a tough decision. “On the one hand”, he said, “we knew that more private offices meant more profit. On the other hand, we knew that the common areas were the ones that would help us build community and give our members the added value they were looking for.”

The decision paid off. Though not without it’s first-hand consequences.

“Our biggest challenge to date has been Mexico’s own work and workplace culture. Though there are various coworking operators that have been around for a few years, the market is very much still uneducated, and the business center concept is still very much ingrained in their minds.”

“We get compared to Regus a lot.”

Here’s where the element of shock comes in.

“Those who have stopped by and visited the space have gone under some sort of shock.” Alan explains that most visitors expect a traditional business center setting when they walk in and they are baffled by the creative and casual look and feel of the space.

And although they have the element of shock going for them, there are other challenges that they will need to overcome.

“Coworking in Mexico is still very divided.”

While young professionals are hyped about the concept, larger and more established companies are still resistant of the movement. For Work Inc, this is not ideal, as they are going after bigger, more established clients as these are the ones that are able to afford Work Inc’s prices.

Alan acknowledges that their prices are above the average, but not without good reason. “We’ve partnered with Meeting Hub to give us an operational advantage to create a more seamless experience for our users. Additionally, there are no ‘extra costs’ for anything in our space; we provide snacks, drinks, printing, event access, unlimited meeting room hours And although at first it seems like too much, people are starting to truly see the value of this.”
Mexico is a big and competitive market, and because it’s still very much divided, operators have to truly ‘win over’ their members. “We’ve invested heavily on real estate and design; but this is all replicable. What’s truly differentiating us the our community, the types of companies that have chosen to work with us, and the ones that we’ve accepted in our space. We will continue to be selective with our community, even if this means losing profit at first.”